Galatioto Partners — A Nudge from the League?

It has been two days since the press release heard around the (Warriors’) world. We don’t know much more now than we did then, but those willing to engage in a little reading of tea leaves based on the circulating rumors could reach some interesting conclusions. The usual disclaimers apply here — I’m connecting dots based on my own speculation — but until we get some actual sale news, there’s nothing much more for us to do.

Since Monday, here’s what we’ve learned (both reports and rumors):

Chris Cohan has retained Galatioto Sports Partners (GSP) to put the team on the market. (Want to relive Monday’s magic moment? Here’s the press release.)

Larry Ellison is rumored to have had a deal in place with Cohan twice, only to have Cohan back out both times.

GSP’s Vice Chairman is Russ Granik, easily the most-connected NBA power player not employed by the League or a team. He was Stern’s heir-apparent for ages and would be the perfect guy to get a group of serious, committed NBA specialists to take over the Warriors.

Here’s how I connect these dots: the NBA values the Bay Area as a basketball market and would love to see a well-run team flourish here. Cohan has shown all signs of wanting out, but hasn’t pulled the trigger because he keeps thinking he can get more money for the team. Frustrated with the Warriors’ accelerating nose-dive and Cohan’s failure to reach an agreement with Ellison, Stern and the league gently (or not so gently) suggest that he might want to work with GSP to run an organized, professional sale of the team. By bringing in GSP and Granik, there’s not only a better chance of hitting a price that Cohan will accept, but there are credible figures to persuade Cohan that holding out repeatedly for a better deal isn’t a good move.

Again, I’m just speculating here, but three small signs suggest to me that Cohan wasn’t the driving force behind bringing in GSP:

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First, Cohan isn’t an out-sourcing type of guy. He prides himself on being a savvy businessman and has made decisions with the Warriors in a high-centralized way. That’s part of the reason the Warriors are in their current mess. Cohan (and, by extension, Rowell) like make their own decisions, even when their track record for doing so is questionable. This move just doesn’t fit his MO — it’s almost like an admission of defeat for him to not only bring in an outside firm to handle the sale, but then to issue a big press blast about it.

Second, the Warriors have been super-secretive with all things related to selling the team. All questions about it were immediately denied, and those asking them were targeted for engaging in baseless speculation. Even when Rowell most recently mentioned that “someday” the speculation might be true, it suggested a desire to keep the process quiet even with abundant evidence that the team was on the market. For the sale process to suddenly “go public” suggests to me either an ulterior motive (renew now!) or someone else (GSP) running the sale process without being completely beholden to Cohan’s wishes.

Third – and this is a very minor point — GSP, and not the Warriors, broke the story of the sale. Street & Smith’s Sports Business Journal had the story up well before the Warriors got around to issuing a press release. GSP confirmed it. The Warriors initially declined to comment on the story. Once the cat was out of the bag, however, the Warriors issued the same release as GSP and pointed all media inquiries to them. There could be a variety of reasons things went down this way, but — again — this doesn’t fit Cohan and Rowell’s usual way of handling matters.

Taking the very big leap that some of the above might have gone down, I think there are reasons for optimism and concern. The optimism arises from the League — through its independent but well-connect emissary Granik — finally doing something to help end the Warriors’ slow bleed. If anyone can get Cohan the best possible price, it’s going to be these guys. The concern, however, comes from the question of whether Cohan has any realistic sense of what the team is worth. Ellison drives a hard bargain, but only two men in America — literally — can offer more for the team than he can. I’m not sure an auction is going to produce bids much higher than what Ellison may have on the table. And if Cohan is fixated on an unrealistic price, even a broker and a competitive bidding process won’t guarantee a sale.

For the final time, all of the above is just speculation — but it’s more fun than speculating about how Devean George will do matched up against Zach Randolph Wednesday night. Whatever is going on behind the scenes with the Warriors’ sale, we can only hope it produces a new owner as soon as possible.

Adam Lauridsen

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So Cohan’s secret plan is not a secret. I hope the nba created some posturing to encourage this public sale. Whether its 4 mo or 12mo, I’m sure a sale is invevitable. Let’s just hope it doesn’t turn out like New Jersey.

Big question, what do we do with the draft or the biggest free agency of the summer? Did the excitement for Randolf dissappear? People were loving him after his 1st and 2nd year. Same thing with Biedrens. I say keep Curry he’s already proven…why duplicate?

Jules

Thanks for the speCCulation, Adam. It sure sounds like the NBA Owners’ Tourniquet has been put into full effect in order to force a stoppage on the blood letting in the City of Oakland… and the Bay Area Market.

Soon…

stackjack

Not sure you’re on the right track here. It is very standard for an owner (even one who makes “decisions in a highly centralized way”) of a private company of this size to hire an investment bank to sell his company. I read Cohan’s “going public” to mean he’s ready to sell now. It sounds like he’s hired a heavy hitter in NBA circles to garner interest. All good things if you want the team to be sold.

It’s not clear that the company was ever on the market, only that Ellison had made an offer. There is absolutely no way GSP issued that press release without the team’s consent. It’s a privately held business, owned by one individual. Cohan must have given OK for PR to be issued. He may have been pressured to do so by the league but he gave final OK.

Bucher today confirmed Ellis had an agreemtn in place that COhan backed out of. Twice. Price supposedly fine and everything.

Ellison can just sit back and watch Stern and Cohan SWEAT on this one.
He can buy any team he wants, any time.
Warriors might leave Bay Area before Ellison pays more than he should for this disintegrating roster, arena.

stackjack

CC, I think it’s a different ballgame now that the sale process is public to fans, NBA, other bidders. Cohan can no longer deny negotiating with Ellison. Think it’s a strong signal he will sell.

Cohan must believe Ellison was low-balling him and that there’s enough interest from other bidders at the valuation levels they had discussed. A full-blown auction process will determine if he’s right.

Also not surprised the reps are mentioning the PR. Not saying it’s logical but clearly some STHs are motivated to renew (more commissions for reps) given that news.

In any event, I view the PR as a positive. May not happen overnight but feels like ownership transition is very real now.

Jules

*Stern will announce sale of Warriors in early June 2010… just in time for new ownerS to participate in the draft.

**Stern will provide new legal language that can quality new Ws ownership to participate in draft, BEFORE the closing of the team sale happens.

***Stern will provide new legal language that can quality new Ws ownership to participate in free agency, BEFORE the closing of the team sale happens.

****Stern will help ANYONE who wants to sue Chris Cohan afterward!

Jules

…language that can “QUALIFY”…

http://chriscohansucks.blogspot.com/ Chris Cohan

No stackjack, he already AGREE TO SELL TWICE.
Adam’s got it right, by the way, and Kawakami REALLY nailed the team and Flunkster Dude to the wall.

League wants Cohan and Rowell and Ridder and the ball boys and the interns out. Right now. But Cohan, if he intends to play his famous Hardball! with LARRY FREAKIN ELLISON is just going to fail at this like the little inheritance brat loser fails at everything else.

There’s no low balling sj- Cohan backed out of agreements with Ellison TWICE. Cohan has no leverage and no choice, that may be true.

This isn’t going down before the lock out.

earl monroe

#13 There is a lockout coming? Really? Noooooo!

earl monroe

Sorry I forgot the smiley face with movement

stackjack

I’m not saying I think Ellison was not offering a fair price. I’m saying Cohan believed he was getting lowballed (or got cold feet or some other weird reason like wanted to F with Ellison), and that’s why he backed out. Now with public PR, he will feel pressure from fans and league to sell. I also don’t think that GSP would mess around with some BS process unless they thought he really was going to sell.

I’m not close enough to it to have an opinion on when the lock out may or may not happen. Could definitely throw wrench in process.

http://chriscohansucks.blogspot.com/ Chris Cohan

No he didn’t. He agreed to the a price TWICE.
He’s just a wishy washy loser.

JanG

Whatever. I’ll believe it when I see it. In the mean time, A Blatche is unhappy in DC. Not getting along with Saunders. How about BW for Blatche?

believewhat

JanG,

“How about BW for Blatche?”

Please no more head cases to Ws, we had dealt few and left with one. He might eventually mature enough to contribute like RWallace but may take another 5 years.

robert rowell

devean george on z-bo? probably not as bad a AT on stoudamire!

Fritz: “Stoudamire is carrying the mail for the Suns right now.”

probably one of the coolest lines i’ve heard in awhile, give fitz props.

Let’s not forget that the capital gains tax on the sale is 15% this year, rising to 20% after 12/31/10. The government, she do take a bite!

That’s big time scrilla for a transaction this big, particularly for a man with BILLS to pay.

My personal take is that this has been in the works for some time, CC waiting until the last possible moment. When you’re talking about STH renewals in a sale year, this truly is the last possible moment to try and pump up the franchise value. It’d be mighty tough for our beloved owner to back out now. Anyone coming in will be an upgrade, one year more of Nellie AT MOST, a decent draft pick, and hopefully a healthy re-energized roster.

We believe?? Hells yeah!!

Assy McGee

Ok Adam. . .but what do YOU THINK will happen, and when? Additionally, what will ownership’s first moves be?

http://feltbot.com/ feltbot

The kind of analysis Adam thrives on.

jsl

Nice post, Adam. Well-explained.

And really nice to have the Ol’ CC back in good form; nary a whiff of the tiresome scurry after Curry stuff.

I’m still guessing a deal will be in place within two months — and before the draft.

johnfree

I disagree with your last paragraph — I actually think it is way more fun to see how Devean George will do matched up against Zach Randolph Wednesday night.

I mean what is this all about? Enjoying the Warriors. Is it still basketball season? yes. Who are the W’s? sadly, they are Devean George and a bunch of d-leaguers.

So I for one will go ahead and enjoy tonight’s game (at least for a while . I will learn nothing more about the sale (god may it happen), so in terms of tonight, the sale is ephemeral(?), while Devean George is (sadly) real.

why don’t you just enjoy basketball while you’re got it, before the four-month wasteland of baseball sets in.

Justafan

Feltbutt your becoming more and more worthless by the day. STH don’t renew until there is a letter of intent. Chris Cohan is desperate and When Larry E buys we will all rejoice But untill the dotted line is signed: BOYCOTT

Justafan

Feltbutt your becoming more and more worthless by the day. STH don’t renew until there is a letter of intent. Chris Cohan is desperate and When Larry E buys we will all rejoice But until the dotted line is signed: BOYCOTT

Justafan

Sorry for the second post

Common Sense

Cohan must divest before the lock out. That is a hard d(r)eadline he is up against.
Cohan thinks he is a hard ass when it comes to business, but he has never been on the other side of the table with the likes of LE. And now that Stern (re:the other NBA owners) are involved, and have been quietly for some time, Cohan is about to learn that when it comes to business, he is definitely D-League himself.

…scotch

Bucher also takes a jab at Warrior fans for the being content with being “Entertained”…as he says “If all they want is to be entertained then they shouldn’t complain about 25 wins”!

And for the record he says “Cohan isn’t a bad guy…if he was booed with his son at the AllStar game he would’ve sold the team the next day”.

Common Sense

DW@11 thanks for the link. Did you catch the last line about “see what he can do with the new coach next season.” new coach? hmmmm.

ANNOYED

Notice that Fake CC the Fraud is simply blathering. Without the mention of his source, rather, Fake CC the Fraud is riding on the write ups of Adam and the other writer involve with Adams statements.

Fake CC the Fraud is just another reader like you and I that blogs what he had just read and implies that ‘HE’ knows everything.

A typical FRAUD.

CURSE OF MULLIN

22Marv: That’s a very interesting point about the Cap Gains tax going up at the end of the year. I suspect you are right, that that is one of several significant pressure points (the biggest being the IRS coming after him for other back taxes owed) pushing Cohan to get this completed before the end of the year, so he had to pull the publicized auction cord now. I can imagine that Cohan already hates the IRS and the thought of him giving them more of his money bc he misses the 12/31/10 deadline would be unthinkable to him.

Garbo

Sorry, this must be here. First posted on the wrong thread.

Garbo says:
March 22nd, 2010 at 2:56 pm

GPS isn’t only a broker. They are financiers as well. There were already 3 big names/parties popping up as buyers.

And don’t forget that the IRS is after their $160 million that Cohan owns them. Wonder why Cohan has to hire a broker and go public to make his sale announcement?

****************

Everything is coming together real fast

– the IRS, Capital Gains tax, David Stern, the economy, fan revolt

Keep your fingers crossed. It won’t be long.

Mr Mully

Count me in with JanG, wake me when the ink is dry.

Uncount(discount?) me in for Blatche for BW. What can I say, I’m a sucker for our draftees.

rigged

p i n g – p oink….w i z z z zz ard ∞ ░≈ oops sorry

Mr Mully

Monta/Curry playing GREAT. I guess someone was a little steamed about all the Mayo talk. I wonder how many percentage points we’re burning by winning this game?

Son of Ahmed

Mr. Mully,

I like Ellis as a player, but I don’t see it working out with Curry. For whatever reason they have a zero-sum kind of chemistry. Just no symbiosis there. The Ellis of two years ago would have a better chance of blending. But the current edition has to be the man. He ain’t. Curry is.

I don’t usually subscribe to either/or arguments. Didn’t like it last year when that happened with Wright and Randolph. But this is different. Curry and Ellis just don’t compliment each other well.

The Warriors will move forward with Curry, and Ellis will either join a losing team and be the man (without the team improving much) or he will go to a winner and accept a different role while subordinating himself to an alpha type veteran star.

By the time that happens the team will be sold and the entire Warriors landscape will be unrecognizable.

What will we talk about?

CURSE OF MULLIN

Curry has freakishly good hand/eye coordination and it’s fully present with both hands. Besides Nash, who would you list as the athletes in any sport whose hand/eye is in that class?

Pablo Sandoval? (Kind of early to tell, but perhaps.)
Roger Federer? (Who knows about the left hand coordination there?)
Lincecum? (Ditto, Federer)
Who else?

Jules

Oh, yah, another ROY performance by Steph Curry… padding up his thick portfolio with another 30-pt. game (most by any rookie this year), 11 assists (and should’ve had another 5 or so if recipients could catch and shoot), 5 rbds. (30/11/5 habit…?) and 4 great steals!

Nice game overall by our D-lightful crew and a rewarding win for their efforts. Our ping-pong balls will fall where they are already meant to fall as Stern will make Ellison a welcome addition to their exclusive club…

High game note: 17,123 in attendance! The boycott continues!!

BG

Come on Curse, Every offensive Baseball Player has better hand/eye coordination than Curry. Hitting a Baseball is by far the hardest thing to do in sports. MJ, the best Basketball player Ever proved that.

rigged

I like to hear from Meir his immediate synopsis on the game.

Hello, hello, Meir?? Are you still there??

Ohh, Meir is already way past asleep. I wonder what’s his version will be

BG

I left out Goalies in Hockey too. Those guys hand/eye coordination is incredible.

Jules

COM, just enjoy Curry for what he is to us – a special gift. Others have their own irrelevant agendas and can’t handle what we enjoy… so be it. We win!

Go, Curry! Time running out on Monta…

Al Oha

The Pac Man has pretty good hand-eye coordination.

Or……… make that, fist-eye coordination. And with either hand, too.

BG

@45

Dumb Ass Post!!

BG

@45

BTW, We all Love Curry, so don’t act like you and Curse are the only ones.